Operating a business in Canada requires strict adherence to the Goods and Services Tax and Harmonized Sales Tax regulations. Failure to collect or remit these taxes results in immediate penalties and interest accruals from the CRA.
You must register for a GST/HST account if your total taxable revenues exceed the small supplier limit. Once registered, you are legally obligated to charge the correct tax rate based on the province of supply and remit these funds to the Receiver General.
Do not wait for a CRA notice to register. Spontaneous registration is required the moment you exceed the threshold within any four consecutive calendar quarters.
Calculate your worldwide taxable sales of goods and services. Include the sales of your associates in this calculation to ensure you haven't breached the small supplier exemption accidentally.
Submit an application via the CRA's Business Registration Online (BRO) system. You will receive a 9-digit Business Number followed by an RT program account identifier.
Update your invoicing system to include your GST/HST number and the applicable tax rates (5% to 15% depending on the province). Review the CRA Compliance Manual: Victoria BC for regional specifics.
ITCs allow you to recover the GST/HST paid on business expenses. You must maintain original invoices that clearly state the seller's GST/HST registration number to substantiate these claims during an audit.
View Audit TriggersYour filing frequency (monthly, quarterly, or annual) is determined by your annual revenue. High-revenue businesses must file monthly, while smaller entities may opt for annual filing to reduce administrative load.
Payroll Tax GuideThe "Small Supplier" Threshold
If your taxable revenues exceed $30,000 in a single calendar quarter or over four consecutive quarters, you lose small supplier status. You must register within 30 days of the day you supply a service or product that puts you over the limit.
The CRA utilizes automated systems to detect discrepancies between reported income and remitted GST/HST. Ensure your records are audit-ready by reconciling your accounts monthly.